Google AdSense

SEATTLE – Hagens Berman, a consumer rights law firm, today filed a national class-action lawsuit against Google (NASDAQ:GOOG), claiming the company unlawfully denies payments to thousands of website owners and operators who place ads on their sites sold through Google AdWords.

The lawsuit, filed in the U.S. District Court for the Northern District of California, alleges that Google abruptly cancels website owners’ AdSense accounts often without explanation shortly before payments are due, and refuses to pay for the ads that ran prior to the cancelation.

“This wrongful practice has sparked numerous bitter complaints from website owners across the Web, with some reporting losses reaching thousands of dollars a pop,” said Steve Berman, attorney representing consumers and founding partner of Hagens Berman. “What we believe to be true from our research is that Google’s practice is likely hurting thousands of website owners and operators who feel they have no way to fight a giant company like Google.”

According to the suit, Google’s popular AdSense program translates annually to billions of dollars payable to website operators that host its ads via AdSense. Google’s AdSense advertising program induces website operators to host space for ads on their websites. Each time a visitor to the website interacts with the ad, the ad publisher who hosts the ad earns payment.

The complaint claims that the contracts and terms of service Google requires web publishers to sign are unconscionably one-sided, giving Google free reign to embark on what the suit claims are actions devoid of good faith or fair dealing.

“We have heard from Web publishers who tell us the same thing: Google cuts them off right before a payment is due, and stonewalls them when they object,” Berman said. “Google’s company motto is ‘Don’t be evil.’ Knowing what we know, I think they have a lot of work to do to be true to that goal.”

The complaint states, “Given Google’s contractual terms purportedly permitting it to withhold payment to publishers with disabled accounts, and in light of the experience of the plaintiff in seeing this policy actually effected, the total of earned funds that Google has refused to pay its AdSense publishers could be enormous.”

The lawsuit claims Google is in violation of contracts with users and in violation of the implied covenant of good faith and fair dealing, unjust enrichment, and violation of the California Unfair Competition Law.

The named plaintiff, Free Range Content, Inc., is a California corporation that owns and operates Repost.us. Free Range Content first noticed a spike in AdSense earnings in Feb. 2014. At the end of Feb. 2014, Google issued a report stating that the plaintiff’s estimated earnings for the covered period were over $40,000 – a number that seemed far too high. Then on March 4, 2014—two days before a scheduled March 6, 2014 call with an AdSense representative was slated to occur—the plaintiff received word from the AdSense program that Google had disabled its account.

The lawsuit seeks damages for all U.S. Google AdSense publishers whose AdSense account was disabled or terminated, and whose last AdSense program payment was withheld permanently by Google.